Trade panel ruling is blow to steelmakers

Certain imports don't hurt big U.S. companies, it says

Impact of Bush tariffs dulled

Five countries will be exempt from duties

August 28, 2002|By Kristine Henry | Kristine Henry,SUN STAFF

On the heels of a decision to allow more duty-free steel into the country, the U.S. International Trade Commission dealt another blow to steelmakers yesterday when it ruled that major U.S. producers had not been harmed by certain cold-rolled imports.

The decision means domestic steelmakers - dozens of which have filed for bankruptcy protection in recent years - will not get the added protections they were seeking.

The decision was hailed by steel users, who say they have suffered from higher steel prices because of the tariffs President Bush imposed in March to help the struggling domestic steel industry to get back on its feet.

Last week, the Bush administration announced its latest round of exemptions from the tariffs. As a result, nearly 25 percent of the 13.1 million metric tons of steel included in the March tariff order is no longer covered.

"The [tariffs imposed in March] are already yielding damaging results downstream that are absolutely unacceptable to steel consumers," said Jon Jenson, president of Consuming Industries Trade Action Coalition. "An additional anti-dumping duty would have stopped trade in cold-rolled products entirely."

Since May, about 20 countries have been required to pay an additional 2 percent to 154 percent deposit for allegedly selling certain cold-rolled steel products far below fair market value or the cost of production.

The commission's 4-1 ruling yesterday means that five countries - Australia, India, Japan, Sweden and Thailand - will not have to pay the duties that had been suggested by the U.S. Commerce Department. The commission hasn't ruled on steel from the other countries.

U.S. steelmakers harshly criticized yesterday's decision.

"This ruling will encourage further unfair trading practices that have severely damaged the U.S. steel industry and American workers," said Robert S. "Steve" Miller Jr., chairman and chief executive officer of Bethlehem Steel Corp., which has about 3,400 employees in Baltimore. "Effective enforcement of our trade laws has to be the cornerstone of addressing the world steel crisis. This determination moves the nation backwards, not forward towards a free trading future."

Cold-rolled steel from Bethlehem's Sparrows Point plant is used in containers, automotive parts, metal furniture, hardware, commercial and residential construction, heating ventilation and air conditioning, and appliances.

"This vote occurred even though the Commerce Department found enormous dumping margins of up to 154 percent and subsidy rates as high as 13 percent on imports from 20 countries," said Thomas J. Usher, chairman and chief executive officer of United States Steel Corp.

"The result of this ruling is that American business, American steel and tens of thousands of workers will continue to be injured by illegal foreign trade," he said.

The duties on cold-rolled steel products would have been added to tariffs of 8 percent to 30 percent for three years ordered by Bush for certain kinds of imported steel.

"The ITC decision reflects the facts in this case," Jenson said. "Most cold-rolled steel is already covered by the [March] tariffs of up to 30 percent. As result, U.S. cold-rolled prices have increased 70-75 percent and steel consumers face serious and continuing supply shortages and delays."

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